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Create New on whatever folder we're at

Hello, 

I was wondering if there's a way I can create a new doc/sheet/slide on whatever folder is showing on the extension? 
I find that whenever I want to create a new document in a specific folder, I am unable to do that. 
Instead, everytime I open the extension, go to the folder I want to add a document to, click on the New document button, the document saves itself on the Main drive, not at the folder I went to awhile ago.
I know it's confusing so please see this video. 



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